Saving for retirement grew in complexity recently. The upheaval of the pandemic gave rise to some challenges to saving for retirement.

As you build your retirement savings action plan, it’s important to steer clear of any possible pitfalls that can minimize your hard-earned dollar.

Here are some tips.

Moving forward today

Depending on your age, retirement can seem very far away. Nevertheless, you can gain a huge advantage by getting a start today.

Instead of putting it off as a future chore, begin to explore ways to make the most of your income and company contribution. Any delay can cost you money.

One step people can take is to open an account and begin making contributions, even if they are modest. Automatic contributions are particularly useful and will let you move on without much thought. It’s also a good idea to set up quarterly or yearly reminders to increase contributions. As time passes and your salary increases, it’s wise to evaluate how much is going into your savings and determine if there’s room to expand your investment.

Consolidate accounts

Can you call up your retirement account at a moment’s notice? It’s quite possible that you have multiple accounts floating around given your long career and multiple employers.

If this is the case, then you will want to consolidate accounts. Inaction could cause you to miss out on money that’s rightfully yours.

It’s hard to believe, but some people will forget entirely about certain accounts and fail to track and move it into an active account where it can grow. Rolling over accounts doesn’t require a lot of work. With a little paperwork, investors can roll over previous contributions into a private IRA or 401(k) with their current employer.

Goal setting

Like anything worth accomplishing, it’s important to have a goal in place.

With retirement, the end goal isn’t always very clear. In other words, figuring out how much to save is the million-dollar question. But, even if this is not an answerable question, there are steps you can take to form a plan. One such strategy is to determine your replacement ratio. This just references how much income you will need at the time of retirement to offset previous employment income. While it might be unrealistic to fully replace it, most experts agree, generally speaking, that 70 percent of your last income will pave the way to a successful retirement.

Some people will plan to dramatically cut back on living expenses once they reach retirement status. If this is the case, then you may be able to get away with aiming for 60 percent of your previous income. If you want no changes to your lifestyle, then the number may increase to about 80-100 percent.

Once you figure out your path, begin to build your plan backward to see how much you need to save to reach your retirement goal.

Family prioritization

Parents will do anything for their children. But their family prioritization can set them back years on their financial planning for retirement.

Holding off on savings to fund college expenses can be costly to your retirement plan. To help alleviate this conflict, you can look for other ways to help your children and teach them about being self-sufficient so you won’t have to rely on your children for financial assistance when you’re in your 80s.

Teach your children about budgeting and stress the importance of saving early. These values can go a long way, especially if the entire family is on the same page.

Home Equity Conversion Mortgage

Depending on where you are in your retirement planning, you might qualify for this mortgage option. As a new retiree, you may be able to immediately boost your buying power and savings with a Home Equity Conversion Mortgage.

A Home Equity Conversion Mortgage usually requires a 50 percent commitment and in return, the borrower will no longer make monthly payments as residents of the home and enjoy new financial freedom.

Please contact us today to learn more about this opportunity to boost your income, eliminate the mortgage payment and make good on your much-deserved retirement plan.

*(1) at the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds; (2) charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees; (3) the loan balance grows over time and interest is charged on the outstanding balance; (4) the borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home; and (5) interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full re-payment. This material is not from HUD or FHA and has not been approved by HUD or any government agency.